A LANDMARK deal has been signed between two giants of the Queensland coal market, as Aurizon - formerly QR National - with Indian coal developer GVK to build a 495km rail line able to carry 60 million tonnes of coal per year to a North Queensland port.

Unfortunately this could delay construction on the infrastructure - worth $6.billion and requiring thousands of workers - by up to six months.

The rail will service GVK's three major mines in the Galilee Basin, west of Rockhampton, including its Alpha, Kevin's Corner and Alpha West projects

Alpha and Kevin's Corner could potentially use the entire 60 million tonnes of coal per year capacity of the rail with both purportedly leading the pack in government approvals.

This would mean other would-be producers, including Prof Clive Palmer's Waratah Coal, GVK's Indian competitor Adani and others would have to expand the rail if they wanted to climb aboard.

Pushing for alternative rail lines could prove difficult with Mr Seeney stressing it was the government's "preference" to keep rail lines to a minimum.

Mr Seeney said each player in the Galilee Basin had been widely involved in consultations and negotiations before this announcement.

"We have sought to find a balance between the interests of all parties involved, including project proponents, landholders and communities," Mr Seeney told reporters on Monday.

"Today's announcement is a welcome step in achieving our aims."

Working on a rough plan released by the State Government last year for mining companies in the Galilee Basin, west of Rockhampton, GVK's Australian arm GVK Hancock has fired first in securing a rail and port agreement that may force other firms to fall in line.

Soon after the election last year, State Development Minister Jeff Seeney released a blueprint for the region to avoid criss-crossing of heavy haulage rail lines across the state.

It appears GVK Hancock and Aurizon have met the preference, although the details and specific mapping is yet to be released.

By Aurizon signing on through investing in GVK Hancock's infrastructure arm, the freight powerhouse wins exclusive rights to manage the entire new rail system for the coal giant.

GVK boss Dr GV Krishna Reddy described it as one of the most significant deals in Queensland's coal history.

They will now jointly plan a rail line and port expansion from the Galilee Basin to Abbot Point coal terminal near Bowen.



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